Thailand's Residential Property Sector Facing Supply Costs and Demand Headwinds — Market Talk

About this update from Ap (thailand) Public Co. Ltd.

Thailand's residential property sector is likely facing supply-side cost pressures and demand-side headwinds, say UOB Kay Hian analysts in a research report. Supply-side cost pressures are driven by a surge in construction material costs, which are expected to compress gross profit margins in work-in-process from 2Q onward, the analysts say. For demand-side headwinds, mortgage rejection rates remain elevated, compelling developers to offer aggressive price promotions to liquidate finished goods inventory. The brokerage maintains a market weight rating on the sector. It likes AP (Thailand), which has a buy rating and a target price of 8.50 baht. Shares are 0.7% higher at 7.20 baht. ([email protected])

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